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Financial Instruments in Cohesion Policy

Do the Legal Provisions for the 2014-2020 Programming Period Adequately Address Previous Shortcomings in the Way these Repayable Instruments were Implemented?

Marcel Bode

While public budgets are increasingly facing austerity, repayable instruments as means of political stimulus come to the fore. Especially in Cohesion Policy the use of repayable instruments, also known as financial instruments (FIs), has significantly increased over the last two programming periods and a further rise is expected for the 2014-2020 period. But the generally accepted advantages of repayable instruments over grants can be diluted by severe shortcomings in how FIs have been implemented. This paper examines some of the most important weaknesses of the FIs set up by Member States in the programming period 2007-2013 and assesses the extent to which the legal framework for the 2014-2020 period addresses these shortcomings.

Marcel Bode works as an auditor at the European Court of Auditors in Luxembourg. The opinions expressed herein are those of the author and do not in any way reflect upon the institution for which he works. The author is grateful to Mr Rares Rusanescu from the European Court of Auditors for his valuable remarks and fruitful discussions on the topic of this paper.


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